Acquisitions

Our acquisitions strategy

At Coats we have a clearly defined approach to acquisitions. We look to identify companies with unique capabilities, technology, innovations, or Intellectual Property that can be scaled to deliver value for customers and shareholders. Any acquisition must allow us to solve complex customer problems with ease.

There are three main areas of focus for our M&A activity:

• Performance Materials: we will seek companies that allow us to gain market access, acquire new skills and technologies and foster innovation
• Services: we will look to acquire companies that provide complementary solutions or skills and talents
• Apparel & Footwear: we will continue to explore entering adjacent categories that allow us to continue on our journey to be the value added partner to the industry.

A track record of success

To date we have a proven track record of successfully integrating companies following acquisition into Coats:

• The acquisition of Patrick Yarn Mills in December 2017 supports a key aspect of our growth strategy, to identify innovation synergies that build scale in high-tech sectors such as cut resistant and flame retardant yarns and complemented our skills in spinning technologies.
• In June 2016 we acquired Gotex, a Spanish company which designs and manufactures high-tech industrial yarns and tapes used in the telecommunications, energy and oil and gas sectors. Since acquisition Gotex has delivered significant revenue growth and geographic expansion.
• The acquisition of GSD in May 2015 and Fast React Systems in June 2016, allowed us to grow our services offer in the areas of improving customers productivity and operational efficiency. Services continued to perform strongly with revenues of $13m in 2017, up from $7m in 2016.